1. On April 22, John Aglialoro’s company Cybex announced that a $62 million judgement had been entered against it with respect to a December 2010 jury verdict in a product liability lawsuit. See the news item here. This judgement equals half the annual revenues of the company. The company is appealing the award. I am saddened that Atlas Shrugged is looking more and more like reality, in this case at a personal level. This is perhaps a part of the context for the future of the Atlas Shrugged Movie.
2. In an interview in LA Times, Mr. Aglialoro complained bitterly about the treatment of the movie by critics, and attributed the poor second weekend performance of the movie to the critical reviews. “”Critics, you won,” said John Aglialoro, the businessman who spent 18 years and more than $20 million of his own money to make, distribute and market “Atlas Shrugged: Part 1,” which covers the first third of Rand’s dystopian novel. “I’m having deep second thoughts on why I should do Part 2.” “
3. I do not think that the critics had the power to influence the performance of the movie: a) The producers ran a brilliant grassroots campaign for very little cost that was effective in getting the fans in to see the movie in the first weekend. b) The conservative press had largely positive reviews of the movie and recommended the movie. c) The liberal press, which consists of most of the “critics”, covered the movie in droves, getting the movie a windfall of free publicity. d) Palpable in most of the critical reviews in the liberal press was an undisguised hatred of Ayn Rand’s ideas–if anything, that would entice an Ayn Rand fan to see the movie.
4. The pattern of success of Ayn Rand’s novels was a slow buildup through word of mouth, followed by sales for many, many years. The DVD/Netflix medium is well suited for that kind of pattern of sales, but the big screen is not. Relative to the box office revenues, the DVD/Netflix revenues of this movie are likely to be higher than expected. The producers have already built a great network of people interested in the movie–they should be able to use it in the next phases to drive revenues. The success of the movie will be limited by factors such as the size of the market, the speed of transmission of word of mouth, effective use of social media to market it, and the production quality of the movie–not Roger Ebert, et. al.
5. The decision of whether to make Part 2 and Part 3 is entirely Mr. Aglialoro’s to make. We are all capitalists, each of us has our own context, and multiple options exist to make the most of the assets one has built. By demonstrating that a decent Atlas Shrugged Movie can be made and marketed in today’s culture, Mr. Aglialoro might have increased the resale value of his rights to make Part 2 and Part 3 of the movie. Perhaps someone who thinks he can make a better Part 2 & 3, and make more money doing it will make Mr. Aglialoro an offer.
6. The movie will be playing in around 400 theaters in it’s third weekend, and Atlas Shrugged holds #30 on Amazon’s Bestseller list.
7. Update: From Mr. Aglialoro’s interview with The Hollywood Reporter on April 27 “The man who says he spent $10 million of his own money to bring Atlas Shrugged: Part 1 to the big screen vowed Wednesday to go through with his plans to make the next two installments, even though critics hate the movie and business at movie theaters has fallen off a cliff.” It looks like the remarks to LA Times were made in the heat of the moment. Stay tuned.